First, Fire All The Brokers: How Lemonade, A Millennial-Loved Fintech Unicorn, Is Disrupting The Insurance Business

The uncertain one: Lemonade thinks the industry doesn’t acquire enough customers online, and that this locks them out of low-premium policies. But Lemonade is also betting that they can convince customers to spend more over time.

“There’s been a complete shift, from what I’m seeing,” he said. “Acquiring a customer that is not break-even or profitable is almost as stupid as driving your car backwards on a highway. You just don’t do it anymore.”

The third piece is essential to understanding the Lemonade bull case. Their renter’s insurance product is incrementally cost-competitive only because overhead dominates their competitors' costs, and Lemonade’s cost structure is more fixed. But in 2019 they spent $175m in operating expenses to produce $13.1m in gross profit, which is not a sustainab... See more